The idle musings of a former military man, former computer geek, medically retired pastor and now full-time writer. Contents guaranteed to offend the politically correct and anal-retentive from time to time. My approach to life is that it should be taken with a large helping of laughter, and sufficient firepower to keep it tamed!

Sunday, February 10, 2008

The problem of cost-effectiveness in military aircraft is as old as flight itself, and is nowhere near being solved. It has a profound impact on air forces today and will be decisive in the aircraft they fly tomorrow, but it's not very well understood by general aviation enthusiasts. I'd like to devote this "Weekend Wings" post to a look at the issue.

When fighting a war (or preparing for one) a government spends what it must to equip its armed forces with the tools they need to win the fight. This is seldom justifiable in purely economic terms and is usually very expensive: but the cost of not providing such equipment (defeat) outweighs the expense of buying it in the first place. However, the demands of defense spending must be balanced against all the other budgetary requirements of running a country. There's never enough money to fund everything at optimum levels.

Unfortunately, the lure of huge government contracts leads to enormous efforts on the part of aircraft manufacturers to sell their products to the State. In their eagerness to "get on the gravy train" such companies have in the past been guilty of bribery, corruption, influence-peddling, overcharging and a host of other irregularities. Companies are quick to point out that the military establishment is guilty of dithering, indecisiveness and changing their specifications to the point where an initial contract can bloat into a huge, almost ungovernable project. The military, in its turn, points to inefficiency, overcharging and lack of co-ordination among companies and contractors as the main reason for problems. There's usually some truth on both sides. (There's also a third aspect, political pressure, which we'll address later in this post.)

Let's have a look at four case studies playing out right now in the US military.

CASE ONE: A NEW PRESIDENTIAL HELICOPTER.

After 9/11 it was decided that the President of the United States should have a more modern, updated helicopter fleet (the existing Sikorsky aircraft had been in service almost thirty years and were showing their age). The European-designed EH-101 won the contract in 2005, with Lockheed-Martin and Bell Helicopter Textron heading a consortium to build it in the USA under the designation VH-71A Kestrel. (As always, click on the pictures for a larger view.)

However, the project is now in serious financial trouble, costs having ballooned from an initial figure of 6.1 billion dollars to an estimated 11 billion dollars at present. For a proposed fleet of only 23 helicopters, that amounts to almost half a billion dollars per aircraft!!! The reason? The Department of the Navy (the prime contracting agency for the helicopters, which will be operated by the US Marine Corps) has initiated hundreds of changes to the initially contracted specification, demanding increased power and range, major electronic system enhancements and a host of other details (some so extensive as to require major airframe modifications). The military has criticized the performance of the companies developing and producing the helicopter, but the latter (with, I think, considerable justification) point to these changes as the primary cause of their poor performance, each change necessitating major adjustments up and down the flow of designs, materials and equipment to and from the factory and sub-contractors.

Amidst the charges, counter-charges and confusion the entire program may be restructured. Needless to say, competitors are hoping that the problems will become so intractable that the entire contract will be cancelled and the procurement process re-started. Personally, I think that to take a helicopter costing about $25 million in its standard form, fully equipped, and morph it into a monstrosity costing twenty times as much is absolutely unconscionable, completely unjustifiable and a colossal waste of taxpayers' money.

However, it's had a long, painful, sometimes disastrous and extraordinarily expensive development process. Each Osprey will cost four to five times as much as a helicopter that can do many, if not most, of the same tasks (albeit flying more slowly). That's a bitter pill for many to swallow, but efforts to cancel the program in the early 1990's were derailed for political reasons.

The aircraft has been in development for over twenty years, and upwards of thirty people have died in crashes in the process.

There's been fierce controversy about the Osprey, with accusations of major technological problems, political favoritism and falsification of test results. All of these problems appear to have been overcome, and the aircraft is now in operational service with the Marine Corps (it's just been deployed in Iraq). Nevertheless, it's estimated that the entire program (development and production) will eventually cost upwards of $50 billion. That's an enormous sum, particularly when spread across fewer than five hundred aircraft scheduled to be purchased. The unit price is staggering - comparable to an F-35 fighter. A helicopter to lift the same payload over the same distance would cost a fifth to a quarter of that amount.

Any fair observer would have to agree that the Osprey in its current form represents a major technological achievement. Its performance is truly impressive.

However, it's consuming a huge proportion of US defense expenditure, to the detriment of many other important programs. The question has to be asked: is it worth it? I'm afraid that I, personally, would answer "No". I'd rather see the US commit a quarter of that sum to purchase a similar number of already-proven helicopters (e.g. the Sikorsky S-92 or the AugustaWestland EH-101) that can do most of the work allocated to the Osprey, and use the money saved to buy other much-needed equipment.

CASE THREE: A PROLIFERATION OF FIGHTERS.

The US has two major combat aircraft programs under way at present. The first, nearing the end of its planned acquisition cycle, is the extremely capable F-22 Raptor.

This stealthy fifth-generation aircraft is said to be superior to anything currently fielded by other nations - but it costs over $350 million apiece, including amortization of development costs over the number of aircraft expected to be purchased. That's a colossal figure. From an initial proposal to buy over 700, the US Air Force will now receive less than 200, largely due to the costs involved.

This had its genesis in a decision to design a single aircraft that would meet the needs of the US Air Force, US Navy and US Marines, as well as allied nations. By producing many of them to serve all these forces it was hoped that the unit cost would be kept low. Advanced avionics, "stealth" features and other desirable features were specified, and three different versions would be needed. The F-35A would replace F-16 and A-10 aircraft in the US Air Force; the F-35B would replace the AV-8B and early models of the F/A-18 in US Marine service, and offer vertical or short take-off and landing (V/STOL) ability for use aboard Marine assault transports and the smaller aircraft-carriers of other navies; and the F-35C would replace earlier F/A-18 models aboard aircraft-carriers of the US Navy.

Initially intended as a relatively low-cost program compared to the F-22, the F-35 has grown steadily more complex - and more expensive. It's now estimated that each one will cost from one-third to half as much as an F-22. That's not nearly so great a saving as was once envisaged, and already complaints are being made about "cost creep".

Recently the USAF's F-15 fleet was grounded as a result of an accident that revealed cracks in fuselage components. More than a third remain out of service, possibly permanently. Many of the USAF's fighters are more than twenty years old, subject to restrictions on how fast they may be flown and how severely they may be maneuvered. In response to these problems, some Air Force sources are calling for the purchase of more F-22's: but this is unrealistic. To buy enough F-22's, at today's prices, to replace the USAF's older F-15's and F-16's would cost more than the entire annual US defense budget! Furthermore, in the current operational environment not one F-22 has seen service in Iraq or Afghanistan, nor are any likely to do so. They're useless against terrorists.

The question thus becomes: should the USAF spend many billions of dollars to buy a relatively small quantity of the most capable latest-generation fighters, or - for the same or less investment - maintain a smaller fleet of highly advanced F-22 fighters and buy three to four times more aircraft that are almost as capable as the F-35 (except in the area of stealth)?

Fleet size is very important. In wartime one can't afford to lose too many of a limited number of aircraft - these things take a year or more to build. If the USAF starts a war with only a few hundred stealthy aircraft, and loses half of them, it's in trouble. Of course, proponents of the "latest and greatest" argue that they won't be lost, precisely because of their stealth features: but that's no longer certain. Advances in radar technology have already demonstrated the ability to track so-called "stealthy" aircraft, and it's very likely that over the next decade potential adversaries will field some of these systems. If at that point the USAF has only a relatively small fleet of suddenly-vulnerable aircraft, it won't be in a very healthy position at all.

I'm not in charge of Air Force procurement: but if I was, I'd buy several more squadrons of F-22's for the air superiority/defense mission, scrap the F-35 and buy a bunch of F-16XL's built and equipped to the latest standards. The Navy could get by with its latest-generation F/A-18E/F fighter-bombers. I'd save money and have many more aircraft available in case of emergency.

CASE FOUR: TRANSPORTS IN TURMOIL.

The USAF's heavy transport fleet is in dire need of expansion. For long-range heavy cargo it relies on two types of aircraft. The Lockheed C-5 Galaxy was designed in the 1960's and is the largest transport in the USAF, lifting up to 135 tons of freight. It's restricted to long, hard-surfaced runways.

The second is the Boeing C-17. This aircraft entered production in the 1990's, and carries about 80 tons. It requires a considerably shorter take-off and landing distance than the C-5 and can operate out of rough forward airfields if necessary - and it's MUCH quieter!

Smaller cargoes are handled by the C-130 Hercules, which has been in service since the 1950's. The latest C-130J model (shown below) has upgraded avionics and systems, but is still limited in the weight (up to 20 tons) and size of cargo it can carry. A larger and more capable replacement is needed.

The C-5's are old and worn. Some are being upgraded with modern avionics and engines. However, the cost of upgrading a single C-5 is about half the price of a new C-17. Indeed, there are persistent reports (including from the USAF itself) that the upgrade cost has been deliberately understated by Lockheed, and may be significantly higher than budgeted. There's also the problem that the C-5 has been a long-term disappointment in terms of its serviceability and reliability. The upgrade is supposed to resolve these issues, but there's no guarantee of this - only promises.

Adding to the problem, politicians from districts where C-5's are stationed and where they'll be upgraded have been fighting tooth and nail to keep them in service and the proposed upgrade on track, despite the very serious problems and cost overruns that have been encountered and are predicted. In doing so they've fought (so far successfully) to limit new orders for the C-17. However, this has caused Boeing to announce that it will close down its C-17 production line next year in the absence of further orders. Once it's shut down, it'll take years and cost a great deal to restart it. If the C-5 upgrade isn't successful, this will leave a huge gap in USAF transport capabilities.

The USAF's air transport fleet is already overstretched - so much so that it's had to charter Russian transport aircraft to fly heavy cargoes from the USA to Iraq! The budget squabbling over whether to upgrade the ageing C-5 fleet, or buy more C-17's, or do both, has left the service unable to cope with current demands. Furthermore, the immense cost of programs such as the F-22, F-35, V-22 and others has meant that less money is available for the transport fleet, which is at least as important to overall US operations as combat aircraft.

If this were my decision, I'd scrap the C-5 fleet over time as the aircraft wore out, buy another hundred or so C-17's for specialized military cargoes and buy commercial freighters such as the Boeing B-777F to handle routine airfield-to-airfield transport missions. The latter are cheaper than specialized military transports, can carry over a hundred tons of freight and, with only two engines, will be far more economical in operation than either the C-5 or the C-17. I'd also look to replace the venerable C-130 over time with a larger plane like the Airbus A400M or Antonov An-70, which could be produced in the USA under license using American engines and avionics. Either of these aircraft can carry more than twice the weight of cargo of the C-130 - enough to efficiently augment the larger jet transports in strategic airlift missions - and has similar rough-field tactical airlift capability. That aircraft mix would be far more capable than what's fielded at present, and would probably save money into the bargain.

There are many other aircraft programs I could cite as evidence of the problem, but these four should suffice to make the position clear. Adding to the budgetary woes of the Armed Forces is that major expenditures on aircraft must inevitably affect other programs needed by the Army and Navy (vehicles, ships, weapons, etc.). The budget can only be stretched so far.

Political interference is also a significant factor. We've mentioned it in connection with the C-5 upgrade. It extends to any Congressional district or State where aircraft manufacturers provide jobs. Politicians are lobbied incessantly by these companies to obtain contracts for the benefit of their constituents. In the current selection process for a new Air Force tanker, the KC-X program, competing manufacturers are lobbying local, State and Federal politicians, trying to get their votes on the grounds of political expediency rather than ask them to ensure that the Air Force gets the best aircraft for its needs. The same was true of the Presidential helicopter competition - as soon as the victory of the VH-71 was announced, the Congressional representative from the district of the losing contender immediately launched a barrage of criticism and attempted to kill the deal. Aircraft manufacturers make sure that members of Congress and Senators are kept up-to-date on issues affecting employment in their districts and States, and contribute heavily to their election funds. As a result these politicians often try to insert language into defense appropriations favorable to the companies in their constituency, with seriously negative consequences for the armed forces.

The problem of funding for military aircraft programs is as old as the aviation industry, and is likely to be with us forever. However, at present it's of particular importance. The USA spends more on defense than every other country in the world put together. The Pentagon's latest budget request is for well over $600 billion: and according to the 2004 CIA World Fact Book, all other nations spent about $400 billion in total for defense. Given other budgetary demands and priorities, it's highly unlikely that Congress will be prepared to spend much more on defense than present levels - and once the Iraq conflict is over it's likely to cut back on defense spending again. The USAF, like other branches of the US armed forces, will have to "cut its coat according to its cloth" rather than demand more and more money.

That's certain to have a substantial impact on force levels. If "feature bloat", inefficiency, cost inflation and political interference can be controlled, a lot more money will be available for aircraft: but if these factors prove unmanageable, they'll consume much of the budget and the USAF's fleet will be that much smaller - perhaps too small to perform all the tasks required of it.

6 comments:

Preacherman:First, let me congratulate you on your recent milestone; I have enjoyed your writing since the beginning (as I always have on TFL, THR, et al).

I happen to have considerable personal involvement in the test programs of the VH-71 and the V-22, plus some earlier involvement in JSF/F-35.

I think you're wrong on the V-22. After considerable pain in the birthing and maturing process, culminating in the tragic crashes in 2000, the program, the manufacturer, and the aircraft underwent a thorough rework and entered an era of a new mindset that is a model I use in haranguing other programs today to "Do the right thing." The new mindset cam be characterized as open, honest communication among all government and industry players. Think "Open Kimono."

The aircraft defies comparison to any extant helicopter. It lifts an honest 10,000 pounds, it cruises comfortably at 250 knots, and it will have you on a rooftop or an amphibious carrier 500 miles away in 2 hours. I've done that many times.

VMM-263 is demonstrating the utility of the MV-22 every day in Al Anbar; 10 aircraft are flying over 600 hours each month, and the aircraft are impressing everyone who receives support from the Thunderchickens (Yeah, that's their unfortunate nickname).

The Osprey is done.

The VH-71 SHOULD be done. In my almost 50 years in the military aircraft business, I've never seen a program so off the rails. I believe the current problems arose from two early mistakes: the replacement for the VH-3 aircraft was suddenly accelerated and made a top priority by the White House; and the Navy chose a consortium of several foreign firms to produce an aircraft with such classified features that authorities couldn't even say why certain requirements were needed. recipe for disaster, that.

There were no changes--ever--to the operational requirements; L-M and Augusta simply did not understand them when they bid, and only came to realize the daunting nature of the job after a handful of Increment 1 aircraft (basically EH-101s) were bought and they had to engineer a VH71 from the 101. Additional factors apply, such as the different standards required by NAVAIR and the FAA (crash survivability, etc) But, in my opinion, the VH-71 is an unexecutable problem and should be started over.

Ironically, the V-22 could meet all the VH-71 requirements with room to spare, but is not politically achievable; the Red Herring excuse is that the V-22 would destroy the Jefferson Magnolia on the WH lawn.

The F-35 will struggle on: it's got a lot of the F-22 technology and will be a superior fighter. The real challenge there is to contain costs while adequately testing it (don't repeat early V-22 mistakes) and retaining the "gee whiz" features.

1. I agree that "the Osprey is done" by now, because it's too late to stop it: but that doesn't mean that it should ever have been allowed to reach its present position. I still believe it should have been killed off in the early 1990's before so much money had been poured down its bottomless pit and so many lives had been lost.

There are helicopters that can carry the same load over the same range as the Osprey, albeit not as fast. The Sikorsky S-92 can carry 22 troops or 10,000 pounds of cargo, and has a range on internal fuel of 800 miles (perhaps less if fully loaded) and a cruising speed of 150 knots. The AgustaWestland EH-101 can lift 24 seated troops or 12,000 pounds of cargo over a claimed range of 750 miles at a similar cruising speed. The only advantage the Osprey appears to have over either platform is its speed. Apart from that, either of these helicopters could replace it.

Now that the Osprey's incredible development costs have been incurred, it's probably no longer cost-effective to throw them down the drain and cancel the program - but I wish someone had had the guts to do so before so much money was thrown at it. As I said in my main post, helicopters to do the same job in the same numbers would have cost a fifth to a quarter as much as the Osprey program. I simply can't accept that it's cost-effective.

2. As for the VH-71, we're in agreement that it should be killed off. Personally, I wish that the Osprey would be selected to replace it! If our Marines can trust it as a combat transport, surely our President and Commander-in-Chief should do the same? Also, I think it'd be a whole lot easier to integrate all the electronics onto the Osprey than onto a helicopter. Perhaps we should suggest that they transplant the Jefferson Magnolia to another location? :-)

3. As for the F-35, I daresay that Lockheed has enough political capital to ensure its survival: but again, I wish that someone had had the guts to stand up at the start of the program and point out the inevitable problems. It's going to end up as another bloated, hugely expensive program without delivering value for its cost, I'm afraid. Even at this late stage, I'd be in favor of cancelling it rather than pouring more money away.

RE: V-22. The missions in Anbar appear to be primarily transport missions. Which makes sense given the aircraft's questionable survivability, and reinforces the author's point. Meanwhile, the Osprey's tiny internal cross-section and large size is forcing changes to a number of other programs, resulting in $120,000 tiny jeeps with no protection, major modifications to Navy ships that drive their costs up, et. al. The 10,000 pounds is very dubiously honest, based on testing, and there are helicopters that can better that easily for less.

Meanwhile, Piasecki is completing a Blackhawk variant with a pusher propeller that can duplicate many of the Blackhawk's performance statistics, and Sikorsky has an X2 program that promises to do the same. Compound helicopters' time has come, without the V-22's costs or risks. Billions of dollars, USMC aviation modernization choked, and 30 dead.

RE: F-22. You have cause and effect reversed. The cutback of the program to 187 aircraft CAUSED the cost inflation to $300+ million per aircraft when development costs are included. R&D is fixed. Cut the number of planes bought and each one becomes much more expensive. Simple math.

The actual flyaway cost of a new F-22A is about $137 million. Recent F-15K/SG Strike Eagle purchases from Singapore and Korea place that plane's cost around $110-110 million, and the Eurofighter consistently comes in at EUR 100 million (now about $150 million). Neither aircraft is even close to the F-22, owing to the Raptor's stealth. F-15 pilots and others on exercises often report that they never see the F-22, just get told they're dead. Even AWACS planes apparently have truble seeing them. Which may explain the F-22's stunning air-air record in those exercises.

Now, imagine what that means to enemy AWACS planes or tankers. It means the enemy can't defend them, and so can't keep them in the air.

Throw in the growing sophistication of long range surface-air missiles (SA-10, SA-20), and a full stealth platform with the ability to defend itself is clearly critical to maintaining aerial access and superiority.

The F-35, with less stealth, no supersonic cruise, and no thrust vectoring maneuverability or canards, has a much bigger problem.

It's almost good enough to confront top-line enemy fighters like the SU-30 family - but not quite. It isn't an AWACS/tanker killer - again, not quite good enough. Up against top-line modern air defense systems... the jury is out; maybe, maybe not. Meanwhile, for most missions (vid. Iraq, Afghanistan) the F-35 is way overkill.

An expensive plane that's almost good enough in all areas is a problem. Now, contemplate that this is the aircraft the US Navy is depending on to give it carrier fleet air superiority until 2050.

The F-22 is expensive, but nobody minds a star player who is expensive and consistently delivers in return.

The F-35, on the other hand, is going to leave the US Navy's carrier force in serious trouble by 2030. And if that's the case, does even a good price justify it as the Navy's only option?

The point leatherneck made on the VH-71 is spot on (like him was personally involved in the competion). The requirements for the VH-71 were NOT changed by the Navy - but never understood (intentional or not it will be never known) by Lockheed. The Navy - bowing to serious White House pressure picked an aircraft that 1)Was never close to the crash/safety requirements required in the Phase 1 of the design (thus MASSIVE work would be required on the airframe) 2)Would have been impossible to build outside the US giving security clearances required - though Lockheed has always stated initial models would be built outside the US (which meant the security was going to be compromised) .. just to name a few problems. The real shame is that everybody knew going into this that it was a black hole (how could NAVAIR/NAVY not know the main cabin needed to be redesigned for the BASIC crash requirements)? That my friends is a pillaging of our tax dollars..